Mass Redundancies Reported at Wiggle Chain Reaction

Feb 21, 2024 at 11:13
by Sarah Moore  
photo

BikeRadar is reporting that there have been mass redundancies at Wiggle Chain Reaction and that while the redundancies are believed to coincide with the sale of the business, this has not yet been confirmed.

The online cycling retailer entered into administration in October following the continued financial turmoil at its parent company Signa Sports United. A statement in December alluded to the sale of the business.

One former employee posted on LinkedIn that "Unfortunately, my time is up, along with everyone else within the organisation."

Several of the former staff already have the green #OpenToWork banners on their profiles and CyclingWeekly is reporting that their sources now say that "only 'a few' people of the circa 450-strong workforce remain at WiggleCRC."

The future of Wiggle, Chain Reaction, Vitus and Nukeproof is unknown at this time. We have reached out to Wiggle and Chain Reaction for comment.

Author Info:
sarahmoore avatar

Member since Mar 30, 2011
1,344 articles

223 Comments
  • 190 12
 The whole market is disaster now.

But please explain me how not a single experienced economist at any of those companies did not see that the demand for bikes during the covid was just a specific bubble that cannot withstand for that long…

Or did they simply ignored it for the short term gains?
  • 209 6
 Greed > logic
  • 88 9
 these companies don't have economists. why would they?
  • 115 1
 All managers I know/knew do exactly this, focus on short term gains. Why, cause they will always find another job and what you earn now is yours forever. Future thinking requires commitment and investment, so not only you don't get the low hanging' fruit, you also seem worse than others who bring immediate profit. In most cases the hard working employees will be the victims, people who bet on a low but steady income, they always loose eventually, whereas the management will always land on four paws.
  • 58 6
 Use sense man - even if you did forecast accurately - if half of the rest of the industry overstocks your still trying to sell your goods into a fire sale market, the whole industry ends up in the same boat regardless, it’s a perfect storm of events.
  • 99 0
 As someone with VERY firsthand knowledge of internet bike retailers the last few years I can say unequivocally that they knew. Not just Wiggle either. They knew it would pop and made the conscious decisions to hire a ton and buy as much as possible to maximize profits. Future pay-offs and shutdowns/selling was an acceptable deal to make.

The people who make real money, made their money and are moving onto the next thing. It's all just greed.
  • 18 6
 You really think either company employs a serious economist or forecaster?
  • 6 0
 *future lay-offs.
  • 13 2
 @totaltoads: I’m not an economist, but it was pretty obvious to me. I think this was a case of managing to quarterly statements instead of long term and groupthink
  • 19 0
 I don't know how much this will resonate, but when it came to running a large ecommerce bike business, worldwide cyclery and did pretty well during the post-covid times when a lot of other similar businesses (bike or non-bike) were struggling. Jeff, their owner, has been on Market Place on NPR a few times discussing business and econ strat.
  • 42 2
 Another thing that I havent seen mentioned much is that when covid hit, some of the bigger manufacturers massively upped their orders for the next year, factories can only produce a certain about of product, so if Specialized wants to order say 20% more bikes than last year, the factory then has less ability to make bikes for other companies, so manufacturers pressured brands to order more bikes so they dont get pushed out by other brands doing exactly the same thing. probably went something like this: "you gotta order 20% more bikes too or else we are going to give the production contract to a brand that is willing to order 20% more"

even if they knew the bubble was going to pop, it could have been more detrimental to not over order in 2020
  • 12 9
 @Maxwrbike: At last an intelligent and real world view not more shouts of ‘GrEeEeD!’ or similar.
  • 32 0
 Anyone who says the party is gonna end is a pessimist and nobody wants to listen to that guy
  • 5 0
 @justanotherusername: Haha im just a bike mechanic regurgitating stuff i hear from my sales reps. glad my blurb came across as intelligent
  • 7 0
 @Maxwrbike:
One of the wildest things was a few local bike brands that will remain nameless said that they were 'sold out of bikes for the next 5 years'.
Now it's easy to say we all saw this coming, when in reality a lot of us thought we'd be riding the wave a little longer, but how on earth can you be taking orders that far in the future? I know a lot of shops were just frantically placing orders to get whatever they could and blocking other shops from allocating inventory. When the bubble burst, they cancelled their orders, and the suppliers are left with a shit ton of inventory that was previously spoken for and now has nowhere to go.
  • 10 4
 @Maxwrbike: The reps have the right handle on this - it’s a much more complicated situation than many think it to be where they just say ‘someone ordered too much cause they thought the good times were meant to last forever’

Plenty of bullshit comments like that above though.
  • 2 0
 Well... the thing here is that it's not just about one company that goes down the drain, but an entire empire collapsed. All based on filthy trust and a ton of personal interest. What could possibly go wrong? I am not sure the whole truth will ever see daylight, but if it will, more people will scratch their heads on how all this was possible in the first place. And some for sure are heading for the back door with their money and won't be seen again. Or die trying...

Just go an google for companies behind Signa Sport and who was/is in the lead.
  • 4 3
 @justanotherusername: I mean the real greed starts now, the chumps that went before we're just children
  • 3 3
 @browner: true that, the vultures are coming.
  • 1 0
 @privateer-wheels: Even if they did, that probably wouldn’t have helped them. 2008 showed us that everyone just runs in the same direction with only 5% of people who know what is actually going on. I work in finance and economists are just in the business of self promotion. Our chief economist was a massive bull. A client asked him what he could see as potential pitfalls for the year ahead and he just rattled of a bunch of positive scenarios.
That was December 2019…
  • 2 5
 Ask Fox how the millions (and millions) they've spent on Outside Van is going...
  • 1 0
 @DizzyNinja: This is the most underated comment on this thread . . .
  • 10 0
 For every two economists, there are three opinions. All four of them are wrong.
  • 25 7
 Man, you people with all the answers to a complex situation need to go into business for yourselves. You’ll make a killing.
  • 3 0
 @totaltoads: True, but regardless it was so clear to see. Perhaps because I'm in supply chain. Unless anyone thought the lockdowns would continue forever, it was clear that once things got back to the new 'normal', sales would drop off a cliff.
  • 8 19
flag flattire (Feb 21, 2024 at 12:23) (Below Threshold)
 The industry does not need 100+ frame manufacturers. Whittle that down to 10, everyone gets a bigger piece of the pie, and is healthier. Maybe they can be retailers for components as well.
  • 15 0
 That's not bicycle market related. The mother company bet on real estate and low interest rates, went bust and took the Signa Sports Holding (parent to CRC and Wiggle) with it. Would have happened independent of the bicycle market. What probably would be different is that in today's market it will be difficult to get prospective buyers, rather than liquidating the assets.
  • 5 6
 Everyone saw it but many of these companies chose to ignore it. When a lot of the manufacturers (bikes and components) asked their factories to ramp up production they were told it was a bubble and that the companies asking would have to pay directly for the expansion of their manufacturing capacity. In short, the manufacturers effed the whole market for a quick buck and now we are all paying for it.
  • 3 1
 Are you new to the bike industry? Let me show you around.
  • 1 0
 The would have needed analysts, but they were too busy asking Shimano and other suppliers in the far East to expand production for what they thought would be the "new normal".
  • 7 6
 @mjscyclery: what a load of shite.
  • 1 0
 I think part of the problem with a bubble is that when it pops, its gonna hurt you anyways. Cashflow is going to take a hell of a hit and the interest on debt isn't going to care. Between that and accountability to stockholders, I think many companies foolishly felt hamstrung to fight for market share and hope they could sell to an even bigger company before the bubble popped. All sillyness, but when inflation benefits the debtor, people are damned either way.
  • 1 0
 @stunnanumma1: I knew he had a really good head for business under all that hair, didn't know he was on NPR for it. Makes sense.
  • 2 1
 They can now write this all off as a loss against there profits .
  • 2 0
 It's a tale as old as time.
  • 21 0
 If any of the armchair economists in the comments would like a bit of insight as to how these things can happen, even when the warning signs seem obvious, here's a pretty in-depth postmortem from the VP of Commercials Ops at SIGNA Sports United USA: www.linkedin.com/pulse/postmortem-signa-sports-united-jacob-dudek-xau9f

PS: the Escape Collective is currently running a four-part podcast series about the current predicament of the bike industry. Check it out: escapecollective.com/how-did-the-bike-industry-get-into-such-deep-trouble
  • 2 0
 @lkubica: well said. Also managers have more plausible deniability if they fail with oversupply ("too much of a good thing"), vs failing with lack of inventory.
Even if it's the *exact same outcome*, leadership will be more upset about missed opportunities.
  • 1 2
 Or, was COVID the out so many businesses where waiting for..
  • 11 0
 There's an awesome 4 part podcast series on Escape Collective about the whole bubble explosion. They are up to Episode 3. Not sure if you have to be a member to listen:

escapecollective.com/how-did-the-bike-industry-get-into-such-deep-trouble
  • 4 6
 Yeah yeah I hear everyone saying its complicated, but at the end of the day the people that made all those ridiculous orders in the name of short term gains got a fat bonus, got let go with a release package, and has another job in management fkn up the industry now. The only people that paid for these mistakes are the poor below them.
  • 15 3
 @Schralpedrubber: You think buyers in companies got a 'FaT bOnuS'?

Ask the buyers at HLC in the USA that were let go with absolutely no warning if that happened - ask the buyers at CRC what 'package' they will be getting now the company is gone.

Why is there the determination to talk absolute shite without any knowledge of the situation at all?
  • 2 0
 @Crza: @rufgo: I've been listening to that podcast and it's excellent.
  • 7 0
 @TheR: There are a lot of folks on this thread with some very keen hindsight! I bet they have some good stock tips from last year too.
  • 1 1
 @gtill9000: A lot of us were in no position to make any difference. Retail shops for one which I'll be t a lot of these posts are from. But thanks for your input.
  • 3 0
 @vp27: Not to argue with your basic premise, but in Dec 2019 nobody outside of Wuhan province had any idea that there was even a problem. We were also bullish and rolling in my business Dec 2019. Much less so in April 2020...
  • 4 0
 @justanotherusername: newsflash: greed is the real world view. If the cycling shoe fits..
  • 2 0
 A little of column A and a lot of column B.
  • 2 0
 @DizzyNinja: Exponential growth curves or bust.
  • 4 3
 @justanotherusername: Buyers are just poor people that work in warehouses bro. Think bigger. You think good business leadership and logic led us to this crux? But by all means defend the people ending your hobby. They really appreciate your contribution.
  • 1 0
 @stunnanumma1: i heard that interview actually. i forgot he said that things went "not terrible" for them. but yeah...i'm sure it's still a shit show for his business right now because everyone else got shortsighted.
  • 18 1
 Hey guys, we are seeing a massive increase in demand, but we are just going to sit this one out and lose out on tons of potential sales because at some undetermined point in the future this trend will reverse and we don't want to make adjustments then, so instead we will make an even riskier future bet now on worse information that is guaranteed to lose us money.
  • 2 5
 @GorgeousBeauGaston: You could always produce at the prior volume, sell everything with little effort, and ride it out knowing the surge isn't sustainable. If you were paying your bills before you'd be paying them now as well. But that greed thing everyone keeps talking about...
  • 5 0
 This is what happens when companies are owned by investors who have zero interest in the actual product and just care about share prices and dividends.

But yeah absolutely stupidity. Didn't take an economic/finance expert to understand that covid was a temporary spike.

People who bought a bike during covid either stopped biking as soon as covid ended, or are the type of person who buys a bike once every 10 years or so.
  • 2 2
 Without more details you cannot just assume it was a weak market that took them down due to lack of forecasting. In this case it was a combination of factors. Weak market. Parent Co with poor cash flows. Brexit. Plus competitors slashing prices because they too were overstocked. It could also be a victim of predatory pricing by competitors aware that they were in a cash crunch. Dropping prices knowing that they had the cash to survive.
  • 3 0
 World governments can't even manage economics properly anymore, you have very high expectations of a bike shop.
  • 1 1
 @a-green: the majority of companies on the world operate to maximise profits I.e greed. This isn’t the reason for their demise it’s multiple factors based on their operating model, world economics and demand for bikes. It would have been very hard for them to scale back quickly after expanding
  • 1 0
 It seems as though the economist on payroll may have been lacking in experience.
  • 1 0
 A lot of these companies have been founded by and then run by people passionate about bikes. Many did not have or do not have the corporate background sufficient to see a business through such a unique time. I'd assume 50% of the current companies will be in different hands within 5 years. I bullish on bikes, just 25% less of them year over year for a few years.
  • 7 4
 Capitalism is failing, the economists unfortunately perpetuate the capitalist agenda, therefore they’ll never admit to its failing end we are currently experiencing
  • 3 2
 @hot-beef-sundae: you know, that VW van you live in is a collectible now.
  • 1 0
 Here in the EU I'm buying mid range bike parts from famous brands for less you can buy stuff on AliExpress. It feels like everyone tried to get in on the OEM market and now there is a massive overstock problem.

Three/four years ago AliExpress parts were 20 times cheaper and maybe worth the gamble. It's crazy just how bad things have got.
  • 1 0
 @privateer-wheels: Economist is not an exact science, that's why the controversy with the Nobel prize in Economics.
  • 3 1
 @zoobab2: that’s true it is not an exact science. But to think that the sales boom during Covid would last was simply foolish.
  • 3 0
 Thanks to all the staff for their work over the years getting our cheap orders out
  • 3 1
 @justanotherusername: not exactly. With accurate forecast , yes they lose sales as you say, but more importantly they dont have working capital tighten up in huge inventories usually financed by debts which at current high rate of interests are making daily operations even more expensive.
Those with accurate forecast they lose sales but have much bigger freedom to operate and chance to survive.
  • 5 5
 @northboy: how do you ‘accurately forecast’ a once in a lifetime event? If you do manage to guess correctly (as nobody has experience with such a situation) then you still get a market where everyone else has overstock flooding the market so your sales are still screwed.

I suppose your another one of the people that ‘knew it all along’, eh?
  • 2 0
 @snakeplant: Yep, capitalism at it’s finest! When you think back, the old bricks and mortar business model was perfect for bicycles but this lot just had to come along and f**k it all up….just feel sorry for all the hard working staff that are now scratching around for a new job
  • 2 0
 It wasnt just about forecasting. It was a combination of a few things. Firstly containerisation prices leapt 5 fold overnight. This mean that all companies has to make sure containers were full, and they were generally paying for less shipments or could access less shipments. This led to a massive shift in how people ordered and manufacturers leveraged this uncertainty about availability of product to drive for higher orders. That said some businesses have been poorly run. The real story of many of these companies is that they were loaded with debt that they couldn't pay as interest rates rose. So some were poor businesses and some were more victims of how globalisation can break down quickly. All COVID did was expose pre-existing weaknesses in the system.
  • 1 0
 It's not just the market. It's the investor.

Search for:
- Signa Sports United
- Signa Holding

There you find the reason
  • 2 0
 @rufgo: Been listening to this, its another excellent piece of work from those guys. Well worth a listen. Has view points from across the industry. Even to someone like myself that works in it, I still learned a few things.
  • 1 0
 @justanotherusername: yup. The industry is screwing itself to death. Companies are slashing prices online, while retailers (who have paid more than the sale price for inventory) are forced to keep up. Covid changed a lot of stuff and not always for the better. Things can't be good when companies like kona and GT are offering a buy 1 get one free discount on bikes. Will be interesting to see what the landscape looks like in the next 12 to 18 months at this rate.
  • 3 1
 @justanotherusername: Whats interesting on this part is that some companies did look at it as nothing more than (admittedly very large) bubble. The line that keeps doing the rounds is Shimano saying that any growth larger than 5% in a year is a blip/bubble. They've been around long enough to know business. They didn't panic and refused to give into the demands of the likes of Specialized. I'm pretty sure that even with their crank recall, they'll be one of the few companies that are in good stead at the momet.
  • 2 0
 @Schralpedrubber: Exactly! No one at the top is a victim here. If they are, then they need to go get a real job..
  • 5 2
 @peteg55: Eeeerm: road.cc/content/tech-news/shimano-invests-ps216-million-expanding-production-284779

You couldn't be more wrong about Shimano, they stuck over £135million into a new facility and £85million into increasing production capacity directly as the result of covid demand.

So yet again, the bullshit that this was easy to manage is just that, bullshit.
  • 4 2
 @rufgo: TLDR, I’m here to make wild assumptions about corporations being evil or ignorant!
  • 1 0
 @zoobab2: Where did I say economics is an exact science? All I said was it was unlikely that they hired economists.
  • 2 2
 Exactly what happened at Muc-off! Intense greed and piss-poor forecasting lead to a bumper round of redundancies. Its mind blowing how they assumed growth would continue at covid levels!
  • 3 2
 @jack-otb: You should have told them how it was oh great oracle!
  • 3 0
 it looks like they got alot of funding to "grow" the business at a loss for the last few years that funding pulled out when it was clear they'd never earn their money back and now their bankrupt due to over expansion. Im sure the board and higher ups got well compensated for driving the company into the ground though.
  • 2 2
 @SwiftFixBike: Read the original article's on PB and elsewhere and you will find out who own CRC / Wiggle, where and why funding is gone and what has happened to the parent company.

Nobody at CRC / Wiggle will win from this, no matter the position - go google René Benko if you want to see who's at the top.
  • 1 0
 "Or did they simply ignored it for the short term gains?"

I worked at one of these companies during the peak of the pandemic. Everyone knew it wouldn't last, but the goal wasn't exactly short term gains, but long term gains at competitor's expense.

Foolish thinking but the execs fully bought into the idea that going bigger and getting inventory earlier meant that we would just absorb business from all of the competition. Overall demand for bikes would drop, but it would be made up for by having more floor space.

In reality, everyone got too much inventory and everyone got it at the same time. That's the reason that all these companies are in the same situation. Those execs made a lot of money during that time period though and aren't the ones being laid off, so it worked out for some people...
  • 2 0
 @totaltoads: yeah, what economist is going to work for 17 bucks an hour?
  • 3 0
 @plyawn: the 90% of economists that can't get a job in their area of training.
  • 2 0
 @rufgo: thanks for posting! That was my article.

There is a big old spectrum of comments in this peanut gallery! My particular favorite is where two dudes are arguing about causes for the failure and they are both right!

SSU was a unique case because of the wild shareholder dynamic but the overall business challenges were a function of:

a) the bullwhip effect - changes in the perception of a demand signal in an industry that has an inherent lag in capacity, production, and supply flow

b) changing industry structure and increasingly intense competitive rivalry on the retail side - brands have finally pushed forward with their pursuit of direct sales and technology like Shopify has made it pretty painless for anyone (including more and more bike shops) to set up an ecomm storefront and compete for share of the consumer’s wallet on the internets

c) selling a vision of future performance to an investor base that simply didn’t reflect reality. A lot of bad business decisions effectively happen the moment a goal, a target, or a plan gets set! They technically haven’t happened yet, but the likelihood of bad decision-making skyrockets when statements about what you WILL do simply don’t match what you and your value chain CAN do.
  • 3 1
 Some of us saw it coming, but we were ignored.
  • 1 0
 @camelvendor: The funny thing is, these problems are plaguing almost everyone (including other industries), so it's obvious that managers' individual decisions weren't the root cause.
I think the phenomenon the bike industry isn't talking about enough is the "pull-forward" effect.
cheddar.com/media/companies-experiencing-pull-forward-effect-pandemic-era-boom-begins-to-slide
The demand during the pandemic didn't come from a magical place: it came from the future, which we are now in. Selling in 2020-2022 was brisk due to strong demand, but not necessarily "easy", and not always in huge excess of prior revenue due to production capacity restrictions.
The demand has dropped, and now we have roughly normal inventory levels, which were always slightly higher than demand, and it is, as you said, too much.
How to resolve?
a.) wait for demand to return, and shed assets (people, brands, etc) trying to survive.
b.) spend or promote on broad scale market activity/activations to drive up demand.
e.g. festivals, ebike incentives programs, expanded trail systems/land access, etc.
Stats show 16% of US citizens rode a bicycle in 2022, so there is a huge percentage of people to engage with.
www.statista.com/statistics/191204/participants-in-bicycling-in-the-us-since-2006
  • 1 0
 @slowmoe: “No one listens to Turtle.”
❤️-Turtle
  • 2 0
 @handmedowncountry:
Holy waback machine Batman..
Souls surfers forevers bro!
  • 78 1
 CRC once used to be the gold standard in the UK. Then they merged with Wiggle, that was the first mistake. Then most recently they had the worst redesign of their webpage known to man. It’s utter garbage. It’s cumbersome, it’s slow, badly designed etc. The worst I have ever seen in fact. Just shite!
  • 17 0
 It was a shocking redesign.
  • 35 1
 So you'd say they had one bad decision resulting into the next, until they went bankrupt. It's like a... what's that word again?
  • 11 0
 To be fair it's not been what it was for a long time. Shame as it was great around 10-15 years ago...
  • 12 3
 @slimboyjim:
They really shot themselves in the foot with all the ridiculous grey market product they were pumping out with stupid discounts that:
A. f*cked the entire bicycle retail industry in the UK and,
B. got them geoblocked by both SRAM and Shimano.
It was all downhill from there.
  • 3 1
 @Mac1987: cycling industry
  • 3 0
 I agree, trying to search for specific items seems almost intentionally prohibitive compared to how good it used to be.
  • 4 0
 It's a bit of a cliché, but CRC really went from an enthusiast / family run business which kicked every ass in sight, became the world #1 cycling retailer, but as more "corporate experts" got involved, it really started to decline.

A lot of the credit for the business making it this far after "business people" got involved were the guys behind the house brands. The passionate product people who made award winning bikes, components, and service. Wish them all well, a superb group of humans.
  • 14 0
 @iian: That's exactly it, a lot of people seem to forget that while CRC grew into the e-commerce giant that it was, it was originally started as a family-run LBS. Built from the ground up and for the first 25-odd years it was filled to the brim with staff who were all bike mad (myself included), and there were hundreds of people working there.

Obviously that all changed with the takeover - I say takeover because it definitely wasn't a merger - with Wiggle, but the vast majority of the real success was done by people who were really passionate about the sport, and fully immersed in it.
  • 9 1
 @ardee: Totally agreed. The Doagh showroom was basically a cyclist's hang out spot.

Even in a business sense, old CRC was superior. Buying up clearance / ex-OEM stock at absolute bargains, passing those on to the customer. Buying regular stock from every hole in the hedge if the price was right. But that wasn't "the Wiggle way"

I still remember the Wiggle leadership telling us off for buying stock from smaller, lower overhead suppliers. Apparently the big UK distributors will happily match the cost prices of some fella in a shed in Belgium. Their experience in a different industry said so.
  • 7 0
 @iian: lol - you could tell the difference in the two businesses almost immediately after the takeover when they all flew over in their brown shoes, chinos and freshly pressed shirts and started calling "town-halls".
  • 2 0
 It was a redesign by a work experience person.
  • 2 0
 @ardee: Sure what did a bunch of boyos from Northern Ireland know about running a business, eh?
  • 2 0
 @Mac1987: no it's a bit like motorsport at the minute you want to make a million you start with two million and watch it dissapear
  • 1 0
 @Compositepro: More like agriculture.

You know the fastest way to become a millionaire farming? Start out as a billionaire.
  • 1 0
 @iian: i suppose thats ones got legs too
  • 1 0
 @Dartmoor365: Each product needs a GIANT picture lol. Ebay had a similar thing happen, some marketing manager needed to justify their existence with a complete website redesign, it sucked. Users revolted, and they were wise enough to revert it back to the original.
  • 1 2
 @iian:
It’s honestly worrying that you think these are good ways of doing business. Sure they work for short term gains, but they screwed the rest of the industry up, and now look where they are.
  • 2 0
 @notthatfast:
How did it screw the rest of industry up from your view?
  • 31 3
 Unless someone offers Mike Ashley big moneys for Nukeproof then that’s the whole lot gone to be turned into nothing more than budget brand names for his online stores.

That’s hotlines, ragley, vitus, nukeproof all gone down the shitter. I feel sorry for all of the staff, what a state.
  • 12 2
 #ashleyout
  • 29 2
 By 'redundancy' do you mean that they fired everyone? I dont think we should use corporate euphemisms to make it seem like tons of normal people aren't getting f*cked over
  • 43 0
 Generally in the UK getting fired means you mess up or rubbish at your job and comes with very little or no financial benefits unless your contract gives you some like most CEOs, being made redundant means your position is going and normally no fault of the employee, this comes with financial recompense in law and generally is based on time in company to amount of lost pay you will receive.
  • 8 0
 @tobyhann: i see. Thanks for the info. Either way, sucks badly for all those now jobless people.
  • 19 3
 redundancy sounds like the british term for being laid off.
  • 8 0
 @adrennan: Exactly. If you are laid off because you are no longer required, you become redundant.
  • 1 1
 @tremeer023: Weird. That's exactly what every manager I've ever had said to me...
  • 5 1
 @adrennan: yeah reading this headline had me scratching my head
  • 1 4
 @tobyhann: I believe if the company is in administration redundancy payments aren't compulsory.
  • 6 1
 @commental: the government pays out I believe. It’s from some Levi that companies pay into I think.
  • 6 0
 @commental: you get a weeks pay for every year you’ve worked for the company, from age 22 to 41, 1.5 weeks pay for every year after your 41st birthday. Google ‘Statutory Redundancy Pay’ for more info
  • 1 1
 @tomhoward379: So most people are getting what, 2-4 weeks pay? Guess it's better than nothing, but not much of a severance package.
  • 4 0
 Yep looks like NP racing is no more, Booker now on Santa Cruz at Hardline
  • 2 0
 @Crom4lom:

Heap and Watson also bid farewell today. I'm afraid it's gonna be really tough finding an open spot on a team for this season... even more so in Enduro.

Wonder what thst neans for Danny Hart and his fresh contract.
  • 2 0
 @Maslin02: it’s not a severance package really, it’s the government providing support for the employees of a business that has no money to pay them. It isn’t written into any contract, but a legal minimum someone can expect.
  • 23 0
 In my 14 years in the bike industry, this is by far the most depressing and uncertain time I've experienced. Hopefully, the businesses within the industry can ride the wave and make wise decisions, as one wrong move can mean game over.
  • 9 1
 Same here man if we knew the demand would plummet after covid we'd cancel all of our bookings

But like idiots we ignored the warning signs cause ordering lots of inventory during covid seemed like the smartest idea ever

now its the opposite..... Then every brand starts offering 50% off when your margin is at best only 30-40% sell everything at a loss Ok Great !
  • 4 1
 @zmcycle: If the rest of the industry does it you are still in the same mess trying to sell your product into a swamped marketplace, you may have better cash flow but probably wouldn’t have made as much money over covid either (maybe not got hold of stock at all)
  • 4 0
 It's a scary wave. Good news seems to be a lot of people on bikes- more than pre-covid and lots of interest in the sport. Not sure if we have stats, but trails seem to be as busy or busier than ever. Living in a mountain bike centered tourist community, I would guess numbers have generally gone up. My hope is that good companies can hold on through the growing pains. Not an economist but seems like demand shot up, products weren't there, rather than seeing it as a acute event companies then produced as though it were a trend, flooded the market, created a glut and tanked the value of bikes and bike products as the market overflowed. Essentially, my guess is that the problem isn't that people aren't still loving bikes and more people aren't getting on them. Just some supply/demand related stuff by the industry not guessing right on what the shifts in covid meant. Fingers crossed for the good ones through these tough times.
  • 14 3
 @justanotherusername: This argument is true if you assume that the profit gained during the "good times" more than offsets the losses incurred today....

It also assumes that a "smart" business owner banked those extra gains for a rainy day, instead of spending it.

Anyone in the industry, or any bike shop owner will be easily able to calculate whether the extra gains made during the boom offset the losses they're incurring today. Given how many brands/shops are scaling back or shutting down, I'd say that the short term gains were not worth the losses incurred today.

I saw the boom-bust cycle coming from a million miles away. I was disciplined and didn't buy a bike during the boom and recommended as many friends to avoid buying a bike during the boom as well. Now, I'm advising friends not to buy a bike unless it's 40% off or more. 2 buddies just bought brand new Yeti SB120's for 42% off...yes, off inflated covid MSRP's, but it was definitely a "reasonable" price to pay today for a Yeti.

I'm still recommending most friends wait it out another 3-4 months to wait till the 24's start arriving in mass volume and wide-spread panic-selling ensues. For 3 years, it was a sellers market. Pendumlum has swung and it's now a buyers market.
  • 4 0
 @justanotherusername: The industry right now is fighting fire with fire its a lose lose scenario if your a dealer

we get word they dropping the price during the peak of season running a sale we have to honor it with future reoccurring sales on any remaining inventory..... ok great

we dump the remainder of our booking along with many other dealers

industry then starts selling factory direct at 50% off to recoup there loss cant even compete its a margin battle whos margin is bigger wins.....
  • 9 2
 @neons97: you are over simplifying this situation - products were at a scarcity with long lead times forcing future orders to be made, if you didn’t order you didn’t get stock and what then? How do you keep a business open for a year with no stock?

All of the outside industry bystanders like to point and blame, easy to do when your not involved at all, isn’t it?
  • 2 1
 @justanotherusername:

actually you can and seems like we might have been better off not ordering anything cause a lot of vendors and suppliers

are offering reduced cost or wholsesale since they've started dropping the prices by passing the savings onto both the dealer and the consumer basically meaning if you did only in season orders any dealer would retain there full margin

as a means of dealing with being overstocked

the only one who gets f*cked is the shop or dealer who took the gamble of ordering so much inventory during covid then just to be told to sell it at a loss
  • 4 2
 @zmcycle: if you had cash flow for two years of virtually no sales then maybe that’s the route you should have taken, people I know in the industry would have to close the doors if they stopped selling for more than a few months.
  • 3 0
 @justanotherusername: Correct at the end of the day we took a huge gamble and it blew up in our faces

now when we tried to course correct by dumping and or cancelling bookings we still got f*cked from the industry undercutting us on what we still had in our current inventory and taking a loss on it

but thats just us we are obviously incredibly fortunate to still be open but this past season was a dismal all time low at best where as that covid high was unbeatable
  • 1 2
 @zmcycle: Are any partnering brands willing to buy anything back? Or at least honor margins, or even a percentage of them? I feel like there should be some shared burden with the shops.
  • 1 1
 @zmcycle: only so much stock can still exist from the covid period, hold on and I am sure the future will be better with decreased competition and margins returning to where they should be, as you say covid was a good period for you and this period would still be bad regardless as the industry dumps stock - what’s done is done now, best of luck with it.
  • 5 1
 @chriskneeland: ok so from what we've experienced the margins are very much favourable if your only doing in season orders as most brands have dropped the wholesale cost while also dropping the msrp

in regards to buy backs or credit reimbursements very f*ckin few we received a partial reimbursement on some previous 22 season booking orders ie carryover being marked on sale before we took a massive dump with our 23 booking we got a partial one for that too for the product we kept ie more in season sales on for those products from that 23 booking

But now we are being told for any future sales we can go pound sand cause we didn't do a 24 booking so we get f*ck all

the general vibe is if you have inventory remaining, From the industry's perspective is you had the time to move it......... and we are only continuously helping those who keep taking the risk by doing seasonal bookings

so in hindsight what did we learn run lean do in season orders for larger items bikes specialty items etc... as most suppliers are just liquidating inventory now's a good time to stock up if your looking to buy it back cheaper.... and don't do net 30,90 day terms pay COD you'll most likely get an added discount on your order

if you cant do that try reducing your overhead by laying off some of your staff sure worked for wiggle......
  • 2 0
 @justanotherusername: every brand that we've encountered in North America is literally sitting on multiple millions of dollars of remaining inventory there's easily enough to go around.... well into next year...
  • 2 2
 @zmcycle: unfortunately I meant 2025 - this years gonna be a rough one.
  • 2 0
 @justanotherusername: can it be normal again will it ever be normal again or will it be a pump and dump forever idk
  • 3 0
 @chriskneeland: Don't worry, the brands are being f*cked just as hard as the shops. Factories are f*cked as well, perhaps even more.
  • 3 0
 @zmcycle: I remember that… we didn’t receive any fat bikes from Giant, Rocky or Salsa until SPRING. The snow was literally gone as the fat bikes started arriving. Then while those arrived, so did next years booking order of fat bikes. It was difficult trying to sell 2021 and 2022 product at the same time. And the only discount you got on a year old bike was the difference in cost that the newer model went up in price lol.

Was also fun when shimano and such wanted their 2022 orders in when almost nothing from 2021 was shipped. Then some distributors allowed cancellations which backed them up.

I got lucky to leave my bike industry job in Jan 2023 right when things started to not sell well. Couldn’t imagine the stress that would have been put on me to make up sales.
  • 2 0
 @zmcycle: Normal like 90’s normal when even small shops could carry a case full of shiny components, full selection of tires, tubes, brake pads, spokes, etc? Or normal like before covid, 30-35% margin while dealer slashes costs and sells everything direct and expects the shop to be nothing more than a warranty claim filter? The bike industry sucks because it’s now targeted towards people addicted to luxury with deep pockets.
  • 1 0
 @Ryan2949: yeah i remember that whole debacle the back to back orders and there justification was if we do it now we can guarantee no more price increases and or some bullshit about potential factory closures anyways what an utter colossal shit show this years has been
  • 24 2
 Sad to see NukeProof get Nuked.
  • 19 1
 I'm old enough to remember the days when pinkbikers complained about how chain reaction was ruining local bike shops and therefore the entire mountain bike seen. Now chain reaction is a group of heroes. God bless pinkbike
  • 9 0
 I used to work in the bike industry and was made redundant, it really sucks losing your job and then not knowing what to do next. I feel for those employees, hopefully they’ll move on to better things
  • 8 0
 Interesting that, whilst the "mass oriented market" is falling apart, I read in an interview to Kornelius Kapfinger (the man behind Intend) a couple of weeks ago that the european niche market is booming.
I do not have an informed opinion on this, I just think it is strange.
  • 2 2
 Where was the interview? - I’d be interested to read it.
  • 7 0
 This aligns with my experiences in the construction industry. Middle class people in my area aren't building houses, but the rich are still building mansions. If money is a concern for them, it's on a different scale and exotic bike parts might be a cheaper hobby than whatever they were doing two years ago.
  • 4 2
 @Bitelio: Thanks, I like the guy and how he does things - The approach isn't one we see promoted today in business (outsource all work and sit on a beach using your phone) and wont see him a multi multi millionaire unless he sells out but he should make a great living and it looks like he gets to 'play' which is obviously what he loves - bit of a mad inventor / scientist type.

He is essentially the polar opposite to much of what is wrong with the industry.
  • 11 2
 Sounds like Mike Ashley got his greasy fucking fingers on them. That pretty well marks the end as far as I'm concerned.
  • 8 2
 I feel bad for employees who are affected and lose their livelyhood. I sincerely hope they find a new job real quick and can pick up where they left of.

As for the managers who made these decisions based on nothing more than blind greed; enjoy the shitshow you've created.
  • 6 22
flag justanotherusername (Feb 21, 2024 at 12:14) (Below Threshold)
 Buyers and mangers are the staff you tool - they are waged to do their job, they aren’t the one or two owners getting dividends. Tit.
  • 14 0
 @justanotherusername: I was talking about the state of the bike industy in general, where I was active until recently. But thanks for the constructive feedback.

Sincerely,
A Tit.
  • 12 0
 @justanotherusername: If you read with some generosity, he likely is referring to those actually making the decisions, even if it isn't the managers. You can always be combative on the internet, but sometimes you end up looking like the tit.
  • 1 17
flag justanotherusername (Feb 21, 2024 at 12:53) (Below Threshold)
 @lwkwafi: it’s the usual nonsense trope of greed greed greed which ignores the huge number of other factors that were at play.

No generosity required here, the post is bullshit.
  • 5 0
 @lwkwafi: Thank you. I am aware of the language barrier, but you've read it correctly.
  • 6 0
 Looks like that's it then for Nukeproof. Game over. Man, what an absolute dumpster fire this whole situation was. Devastated to see a great company, whose bikes were held in high regard by riders all over the world, being pulled into the abyss by a failing retail business.
  • 8 0
 I went to public school. What is redundancies?
  • 6 0
 Layoffs.
  • 2 3
 it’s a uk term for canning people after a merger or sale of a business. “Your job has become redundant” = unnecessary.
I think the US term is often “synergies” lol
  • 4 0
 It's not the no-strings-attached layoff you'd get in the US (I understand every state is different though), as there's a requirement for severance payment. It can be quite a big payment in cases where the employee has worked for a long time with the company.
  • 4 0
 Redundancy means you are no longer required by the company (left without a job at no fault of your own). You get a notice period that you are being made redundant and there is a minimum amount of money the company has to give you by law if your role is made redundant (based on how long you worked there and what your salary was.

It's distinct from being "sacked", "fired", "dismissed" because that generally implies wrongdoing and typically there is no pay associated with this and you can be fired pretty much on the spot. You often get fired for "gross misconduct" e.g. stealing from the business or similar.

In the UK generally you can't fire people on the spot because you don't need them any longer, you have to make their role redundant and go through a whole process. You can only fire them for wrongdoing or consistently bad performance after several written warnings.
  • 1 0
 @shredddr: thanks!
  • 1 0
 @Mayzei: In the US you get terminated with or without cause. You get 2 weeks pay if you are lucky and the day they tell you is often your last day at work. Terminated with cause means you get no unemployment (dole money) also.
  • 6 0
 Sad times. Two former giants gone, thinking of the poor people that lost their jobs
  • 5 0
 Nigel Page has just announced his unemployment so i can only assume thats the end of the team and all the sponsorship for the riders.
  • 1 0
 Welp, unlucky Danny Hart. Just as he thought he got NP as his new sponsor and this happens.
  • 5 0
 And people still think Danny hart is being paid to ride for nukeproof this year.
  • 1 0
 No he's obviously just able to buy loads of frames cheap as chips .
  • 5 0
 Well this doesn’t bode well for my recently broken (within Warranty). Nukeproof
  • 1 0
 Not long brought a vitus, am slightly worried
  • 2 0
 Can i have one of those green ‘open for work’ thingies on my pinkbike profile. Never knew they were a thing but if anyone wants me to go and make trails or bikes somewhere cool and give me some money that’d be fine with me.
  • 2 0
 You know them when you ride near them. These daft management knobs. Id have them no where near my company. Take up other sports and fill the positions with real world intelligence. Often yell Yewwwwww on the bottom pf a green run
  • 2 0
 CRC wiggle will vanish Their former online competitors will gradually increase pricing This in turn will slowly drive sales back into the IBD network Therefore slowly improving the value of RRP, which has been absolutely annihilated over the years The main house brands will survive in a new environment
  • 2 0
 What’s the deal with Tri-sports resort on ebay - it’s blatantly wiggle if you look at the mass of kit they sell. Been a fire sale of virus, Nukeproof and Ragley bikes last few weeks.
  • 10 0
 It’s there returns sell off page, been going years. Used to be full of bargains until word got out and i regularly see stuff go for more than on the main websites.
  • 3 0
 TriSports eBay has been the backdoor sales outlet of Wiggle for literally years. It's not new
  • 2 1
 @IllestT: yeah I have bought from it for years but always thought it was returns they flipped for resale. Recently it’s very much a mass stock drop.. like 20 new rapide fs fast few alone
  • 1 0
 I did not buy a bike from 2017 until 2023. I have since bought two bikes and am looking for a third. Nothing I have bought has been less than 35% below MSRP and most at 50%. Right now if you are a customer with money. you are a king..
  • 1 0
 I feel sorry for the staff being made redundant, some of whom are my friends. The whole situation is a complete mess, so many people left in the dark and many arriving to work that day with not even a hint of what might happen.

There does need to be a serious change of legislation, companies like this use freelancers like myself as staff but then when it goes bad, We get hung to dry! Owed money by wiggle for work done back in June, it pisses me off that administrator gets their cut but we get nothing apart from a bunch of credit card debt due to expenses not being paid for work carried out. I don’t ask for much but to be paid on time is one thing I do expect! I’m sure the many athletes and other creatives feel the same way.

Its a bitter ending, friends out of work and like many others I’m left out of pocket.
  • 2 0
 Supposedly Trek is laying off 10% of their staff as well,
www.teamblind.com/post/Layoffs-comming-at-Trek-Bicycles-eRVsgEay
  • 1 1
 www.instagram.com/p/C3og92Oo6vs/?igsh=MW90dDB3eGNpa2tlaA=

Seems that the Nukeproof team is no more which doesnt bode well for Nukeproof bikes.......glad I got my wheels from CRC when I did, just hope I dont need a warranty job on them
  • 1 0
 That sucks, just as Danny got a ride. Looks like he will be without again!
  • 2 0
 This must have been a quick decision I literally had them warranty my mega last week and the bike shop said everything was going to be all good with them?!
  • 1 1
 I'd heard some rumours at the weekend.....suspect Nukeproof, Vitus and DHB will be ok, but probably selling through Evans now. Apparently Evans are now on a stable footing, so Mike Ashley has turned them around. The other rumour was that Halfords were the other main bidder but they were mostly after their warehousing systems, which are well regarded
  • 6 0
 I don't see how Evans can be on a stable footing as their sales have fallen through the floor. In true MA fashion, any apparent stability is from major overhead cuts which can only balance the books once; selling on leases to business properties and moving to garbage locations.

Watch the remaining Nukeproof stock pop up in Evans stores untill the name gets slapped onto some budget open mould frame and it becomes the next MuddyFox
  • 2 0
 Yeah, rumour has it that contrary to his usual practice of keeping the brand name and IP, clearing out all the staff involved with the development and conception of product and sticking a logo on a BSO, Mike Ashley is going to be the guardian angel that we never knew he was!
  • 1 0
 Any insight into warranties? Will MA / Evans honour these or is it time to look elsewhere?
  • 1 0
 @Mfro: unlikely that Evans/Frasers group will validate warranties for product sold through wiggle, they just bought the IP not the stock. That remains property of wiggle. Tricky situation as it makes much of the stock totally worthless.
  • 7 5
 No to worry. I'm sure they'll be offered their jobs back with the new owner. At vastly reduced pay and benefits of course.
  • 10 1
 And a company pizza lunch once a month.
  • 6 1
 Not a chance, Mike Ashley already owns Evans, his own warehousing etc and has no desire what so ever for in-house design and engineering.
  • 2 0
 @justanotherusername: maybe he just wanted the web domains...
  • 2 1
 @shredddr: he’s apparently bought the IP only - no stock, etc etc so pretty much brand names and websites.
  • 8 0
 If it's Mike Ashley nobody will get their jobs back, his entire business model is taking a recognised brand and sticking it's name the cheapest Chinese catalogue shite he can find.
  • 1 0
 @Fix-the-Spade: Yeah, Karrimor (not to be confused with Karrimor SF) , Field & Trek were once decent.
  • 4 1
 Good for small bike shops, nothing last for ever normality will return.
  • 4 2
 I hope that some good will come out of this. I stopped using CRC a while back, making a conscious effort to support my local bike shop.
  • 1 2
 Tales of sadness and woe aside.
How do you go from being profitable to being £90m + in debt in 3 years?
Bear in mind that with a huge online business that is fully trading and profitable, you get the full money and profit for every single sale before any of your suppliers even think a out printing a delivery note........
  • 10 1
 Take on a ton of stock that doesn’t sell to the EU anymore (Brexit).
  • 2 2
 For the hundreds of little bike stores that built the local bike trails made a local bike scene only to have these A-holes come along and torpedo everything they worked their ass off for. This is sweet dick kicking revenge.
  • 1 0
 Mostly sad because now I can't get nukeproof or prime branded wheels or parts. Those were gold standard budget buys and I can't see anyone replacing them.
  • 1 0
 TBH I don't think we should jump to the conclusion that the Bike brands are dead. I agree that maybe someone of the smaller in house brands will go, but Nukeproof as an example is much bigger. Personally I think someone will buy that part of the business off of whoever has purchased WiggleCRC (when it is confirmed)
  • 3 0
 this honestly sucks
  • 6 4
 They've clearly left themselves no wiggle room
  • 2 1
 The start of their downfall was when they started adhering to shimano's no sales to north america policy.
  • 4 0
 The downfall was when CRC was sold to Wiggle and Wiggle's then owners gutted CRC in 2016. Coincidentally the last time I ever bought somethng from CRC was around that time.
  • 1 1
 Damn, I've been waiting for them to get more stock of IXS Trigger helmets as they seem to be one of the only places in the UK that sell them. Gutted.
  • 5 5
 they'll be fine. Pinkbike's been mass redundant for years and look how thats worked out ;-)
  • 2 0
 Don't let the door hit you on the way out
  • 1 1
 Whew! When I read the headline, I feared someone had taken out a contract on The Wiggles.
  • 2 1
 Bottom feeding companies go straight to hell.
  • 2 1
 CRC used to be great. Sad to see them disappear
  • 1 0
 Apparently Sam Hill will be rejoining specialized
  • 1 0
 ... repeat
  • 1 0
 Mike Ashley's got the Ip
  • 2 3
 It's because all the bikes they sell the bb keep wiggling loose reaction to that is the chains break.
  • 1 1
 chain reaction had good deals like 3 years ago. meh
  • 1 1
 Have we had someone from singletrack pop I'm and start blaming brexit yet?
  • 1 4
 My hips and bum have some wiggle due to mass redundancies... maybe I should go on onlyfans with my Juice
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